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Speaker 1: Hi Everyone. Earlier this year, Elon Musk put out a

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Speaker 1: one hundred million dollar prize for innovation and quote carbon

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Speaker 1: negative solutions or pulling c O two straight out of

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Speaker 1: the air, but benef carbon capture. Analyst David Madrid says

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Speaker 1: Musk is missing the point that what is needed for

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Speaker 1: direct air capture is scale, not new technologies. The technologies

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Speaker 1: for pulling c O two straight out of the air

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Speaker 1: are largely proven, but need larger demonstration products to start

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Speaker 1: to bring down the cost of capture, which right now

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Speaker 1: is estimated at an eye watering six hundred dollars per

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Speaker 1: ton c O two. This week on the show, David

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Speaker 1: steps in to tell us about direct air capture and

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Speaker 1: how it works, the economics and how they compared to

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Speaker 1: capturing c O two from point sources like power plants

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Speaker 1: and industrial facilities, and the three hundred billion dollars already

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Speaker 1: going into a handful of demonstration projects. Our discussion is

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Speaker 1: based on report titled material Tech Highlight Direct Air Capture.

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Speaker 1: BEENOF users can get this report on banf dot com,

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Speaker 1: the Benf mobile app, and the Bloomberg terminal. As a reminder,

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Speaker 1: Beanof does not provide investment or strategy advice and you

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Speaker 1: can hear the full disclaimer at the end of the show.

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Speaker 1: I'm Mark Taylor and you're listening to Switch Don Benif podcast. David, welcome,

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Speaker 1: Thank you. Can you just start it off really basic

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Speaker 1: and tell us what direct air capture is. So director

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Speaker 1: cuture is a conventional carbon capture technology, but instead of

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Speaker 1: capturing the carbon from a point source to general gas

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Speaker 1: processing plan or a power plan, it cuptures the uto

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Speaker 1: from the atmosphere. So it's basically a removal technology. So

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Speaker 1: basically it's a thigulous a mechanical tree. It is. It

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Speaker 1: is actually a mechanical tree, but using more an industrial approach.

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Speaker 1: So yeah, similar to a three removal technology with the

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Speaker 1: main goal of taking C two out of the atmosphere. Okay, cool,

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Speaker 1: So can you tell us what it looks like? Is

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Speaker 1: it the size of a tree or is the size

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Speaker 1: of refrigerator? The size of a house? What are we

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Speaker 1: talking here? Yeah, so the size really depends on how

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Speaker 1: much you two we are capturing per year. But actually

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Speaker 1: we estimated that a conventional director capture plan for capturing

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Speaker 1: one million sounds of C two per year that would

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Speaker 1: require around two square kilometers maximum. When we compare that

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Speaker 1: to a first station, which requires around eight hundred square

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Speaker 1: kilometers that's conventional first station, and also bio energy with

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Speaker 1: CCS requires around three hundred, so we can see that

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Speaker 1: director capital is much lower land requirements. So there were

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Speaker 1: pretty much in a in a better position compared to

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Speaker 1: other room full technologies. Okay, So the idea is that

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Speaker 1: I do not want to deride you know, planting trees,

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Speaker 1: but like you can get more c O two sucked

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Speaker 1: out of the atmosphere her unit of area than you

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Speaker 1: could with a tree. Is that the idea absolutely absolutely

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Speaker 1: much more, much more for a given land, you can

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Speaker 1: capture much mercy two. We have director capture planted following

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Speaker 1: other removal technologies as we said, our first station or

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Speaker 1: bio energy with CCS. Okay, So, I mean I think

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Speaker 1: I know the answer to this, but like, can you

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Speaker 1: tell us why this is popular? I mean, just for

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Speaker 1: those who haven't heard of it, maybe it's getting a

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Speaker 1: lot of attend to right now in the news and

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Speaker 1: as an option for more reducing CEO two. And I

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Speaker 1: guess that's the answer. Is there anything else that that

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Speaker 1: comes to mind? It's popular mainly because companies are looking

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Speaker 1: for removal technologies. Right, So it is pretty much known

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Speaker 1: that we will need some kind of removal technologies in

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Speaker 1: the future to actually get to one point five. So

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Speaker 1: companies are looking to direct air capture in order to

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Speaker 1: remove their emissions. And also we are in a point

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Speaker 1: in where companies such as Microsoft not only want to

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Speaker 1: offset their current emissions but also the tons of SEO

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Speaker 1: two that they emitted in the past. So you can

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Speaker 1: only do that through removal technologies, and there is where

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Speaker 1: directed capture can also play a big role. And also

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Speaker 1: it is true that there are other industries that are

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Speaker 1: really hard to the carbonize, such as cement or still

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Speaker 1: and there we will need some kind of removal technologies

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Speaker 1: to offset the last remaining emissions that we will have

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Speaker 1: in the future because some of the CEO two emissions,

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Speaker 1: well a lot of CEO two emissions from cement production

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Speaker 1: is actually process emissions that comes from the rock itself,

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Speaker 1: right exactly, exactly, Okay, okay, cool? Just to clarify, you know,

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Speaker 1: can you just clarify for people one point five degrees

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Speaker 1: in order to get to a worlding where the warming

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Speaker 1: gets to one point five and not warmer, it is

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Speaker 1: pretty sure and that we will need some kind of

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Speaker 1: remote technology, so we'll need trace of for a station

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Speaker 1: bio or two with CCS minoritization an the director capture

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Speaker 1: in order to take out emissions that are already in

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Speaker 1: the atmosphere. So we need to take out tones of

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Speaker 1: c or two from the atmosphere because carbon dioxide is

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Speaker 1: the main greenhouse. Cassett causes global warming. So now that

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Speaker 1: we've established that, you know, it can be a really

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Speaker 1: great you know way to pulse CEO two out of

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Speaker 1: the air. Can you tell us a bit about how that,

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Speaker 1: how it does that? How does it pull CO two

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Speaker 1: out of the air? Director cup There is pretty much

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Speaker 1: normal CCUS plan, but in set of character in CU

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Speaker 1: two from a point source it takes out from the

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Speaker 1: atmosphere right, so that there are main difference there such

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Speaker 1: as for example, in a director capture plan we need

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Speaker 1: the super large contactor a rise with funds that draw

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Speaker 1: CU two into the collectors right, and there is where

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Speaker 1: all the chemical process happens. But just for for us

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Speaker 1: to understand when we talk about the director culture plan

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Speaker 1: is pretty much similar to conventional c c US facility

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Speaker 1: that is located in a power plant for example, and

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Speaker 1: this technology has been around four decades, right, But the

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Speaker 1: main difference is the cost. So the cost in the

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Speaker 1: points is much lower than taking CU two out of

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Speaker 1: the atmosphere, and that is basically because the concentration of

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Speaker 1: C two in the atmosphere is much lower four hundred

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Speaker 1: parts permilion when we compare that to point sources where

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Speaker 1: the concentration is super high. It depends on the point source,

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Speaker 1: of course. But then if we get to the low

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Speaker 1: hanging fruit fertilizer plants, ethanol plants there, the cost of

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Speaker 1: culturing is pretty much very cheap compared to two current

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Speaker 1: US the direct air cauntor that we estimate to be

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Speaker 1: around six hundred dollars per ton. But again there are

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Speaker 1: different technologies there, and the proposed that they're used for

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Speaker 1: is also different. We need to deploy conventional CCUS plans

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Speaker 1: in those assets that we really wanted to carbonize and

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Speaker 1: then use direct air caunitor for this really hard to

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Speaker 1: carbonizing industries on to offset the last remaining emissions, taking

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Speaker 1: advantage of high cost but super high modularity, easy to

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Speaker 1: deploy technology, But how does it work? Like so specifically,

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Speaker 1: can you tell us about you know in the note

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Speaker 1: that you wrote there are basically two main methods of

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Speaker 1: capturing c U two. Is that correct? That's correct? Yeah,

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Speaker 1: that's correct. Can you describe those? There are two different

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Speaker 1: technologies that are used nowadays, one that is absorption and

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Speaker 1: the other that this absorption that this would be difficult

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Speaker 1: to pronounce, but the main difference in these technologies is

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Speaker 1: how the chemistry works there. So absorption is a volume phenomenon,

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Speaker 1: while adsorption is a surface phenomenon. So in absorption, the

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Speaker 1: C two gets dissolved in the solvent, while in adsorption,

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Speaker 1: being the two are touched in the surface. We need

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Speaker 1: more surface for for the same volume of CU two

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Speaker 1: to get captured at the end. Okay, so let's let's

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Speaker 1: let's break that down really quick. So adsorption solid sponge,

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Speaker 1: let's let's think of it, correct, and absorption dissolved liquid.

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Speaker 1: Does that work? Yeah, that's how it works? Okay, cool?

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Speaker 1: And so those are two main methods of doing it.

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Speaker 1: So can you describe some of the advantages and disadvantages

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Speaker 1: of each type of technology? The main difference is the

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Speaker 1: temperator that the plan needs in order to regenerate the sorvent.

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Speaker 1: So when we talk about liquid solvents, the temperator that

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Speaker 1: is needed is around nine hundred degrees celsius. And on

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Speaker 1: the other hand, for solid absorption, the temperator that is

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Speaker 1: needed is around a hundred degrees celsius. So the difference

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Speaker 1: there is much lower. And that's why in a liquid

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Speaker 1: solvent plan that i'm plats are much higher. Wheels need

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Speaker 1: much higher thermal energy to regenerate the sorbent. Okay, so

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Speaker 1: just to clarify, regenerate the solvent means you fill up

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Speaker 1: the filter or the the sorbent and then you need

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Speaker 1: to get the CEO two out so you can use

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Speaker 1: the filter or the sponge or the liquid again. Right

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Speaker 1: to me, it sounds like a no brainer. What am

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Speaker 1: I missing that you know you have the nine hundred

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Speaker 1: c regeneration temperature. That sounds like a deal breaker to me,

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Speaker 1: and you would go with the one that has a

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Speaker 1: lower temperature. Why is their choice? Like? What makes this

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Speaker 1: liquid sorvent good? That's a really good point, and there

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Speaker 1: are many things that affect the overall cost. But when

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Speaker 1: we compare solid absorption to liquid absorption, it's not only

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Speaker 1: the temperator that makes a difference, but also the materials

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Speaker 1: that we are using on the sorbent that is being used.

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Speaker 1: So the serving is a big part of the gass.

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Speaker 1: And of course companies that are working with solvents use

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Speaker 1: different type of sorbents and companies that are working in

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Speaker 1: absorption or to use different types of materials on servants.

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Speaker 1: So there's a key difference there in the materials that

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Speaker 1: are used to power on, to captor to tow the end.

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Speaker 1: Forgive me from my terminology, but I keep coming back

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Speaker 1: to the sponge and the liquid, right, But so you

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Speaker 1: could you could say that the sponge is more expensive

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Speaker 1: two produce and consume, I guess, and the liquid is cheaper,

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Speaker 1: but the regeneration is more expensive. Is that right? Exactly?

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Speaker 1: That's the difference that we are seeing companies doing, and

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Speaker 1: that's that's what the industry is doing at the moment.

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Speaker 1: You also, there is a lot of demonstration in order

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Speaker 1: to try to reduce the total cost the industritionarily stage,

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Speaker 1: so it needs to get two economies of scale, get

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Speaker 1: the specialized supply chain, demonstrate new servants. But that you're right,

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Speaker 1: You're right, that's the main technology technology differences. Okay, okay,

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Speaker 1: I think we got it roughly. Now, can you tell

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Speaker 1: us what the costs are you know, can you give

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Speaker 1: us a ballpark estimate of how expensive this st first

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Speaker 1: to do, just to give a starting point, current cost

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Speaker 1: of Hunter are around six hundred dollars per ton of

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Speaker 1: C two, so very very expensive when we compare it

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Speaker 1: out to other remote technologies. But then again, as we

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Speaker 1: were saying, the technologies in super early stages, companies are

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Speaker 1: finalizing their pilot plants and trying to scale their technology.

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Speaker 1: So the cost is six hundred now, but it kind

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Speaker 1: of declined, and it really decline. US technology scales more

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Speaker 1: planted commission on build economies of a scalar, realized industries

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Speaker 1: get specialized supply chains. And also these companies learn from

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Speaker 1: operating these facilities, right, so they can reduce the cost

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Speaker 1: of operating and the opex overall would be reduced. And

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Speaker 1: we thought the industry beliefs that we can get to

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Speaker 1: point of around two hundred and fifty dollars per ton

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Speaker 1: of cutuo pupture by twenty thirty and then around a

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Speaker 1: hundred dollars per ton of C two by twenty fifty. Right,

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Speaker 1: so current studies that are released by the company's working

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Speaker 1: in director counter estimate taught in and of a kind cost,

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Speaker 1: we could get two points around a hundred dollars per

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Speaker 1: ton of C two counterct man. Okay, this is fascinating.

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Speaker 1: So we're gonna we're gonna go on a journey here

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Speaker 1: of talking about this cost and what it actually means.

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Speaker 1: So in the US, you know, correct me if I'm wrong,

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Speaker 1: but there's a tax credit I believe called forty five

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Speaker 1: Q where a company can get a tax credit for

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Speaker 1: injecting CEO two into the ground of what is it now,

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Speaker 1: forty five dollars a ton? I want to you actually

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Speaker 1: get fifty if you started on thirty five. You're using

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Speaker 1: foreign hans recovery. Okay, cool, So we're hearing that that is,

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Speaker 1: you know, at least bordering on commercially viable at this point,

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Speaker 1: is that right? That's therrect So point source. You get

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Speaker 1: to a point where the cost of cultury is lower

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Speaker 1: than fifty, then yeah, you can make it a business

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Speaker 1: case out of eats. Okay. So we're at six dollars

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Speaker 1: a ton, now three hundred dollars a ton in ten years,

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Speaker 1: eight years, and then the end of a kind at

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Speaker 1: a hundred okay, So even that doesn't quite compete with

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Speaker 1: what you're telling me. Right now for point source capture.

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Speaker 1: But what I would take from that is that this

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Speaker 1: is you know, personal opinion. I guess that it just

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Speaker 1: doesn't matter, right because my assumption here is that direct

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Speaker 1: or capture we will mostly be important for companies that

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Speaker 1: want to offset emissions and this might be the only

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Speaker 1: option they have to do it. I don't know, is

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Speaker 1: that right? That's right? Just when comparing a conventional CCUS plan,

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Speaker 1: if we are actually covering of the CEO two that

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Speaker 1: is released in these point source plants, it's a power

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Speaker 1: plant for example, there is the other attemplature scent, these

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Speaker 1: tem per cent of emissions also need to be offset

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Speaker 1: at some point, right, so when we deploy all the technologies,

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Speaker 1: there would be emissions that we need to be removed.

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Speaker 1: And that's for a direct our company role. And also

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Speaker 1: you're absolutely right when we compare it costs of point

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Speaker 1: source to direct air capture, it is through the director

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Speaker 1: clupure is much more expensive. But we are seeing pathways

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Speaker 1: where director capture come be valuable for companies to follow

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Speaker 1: instead of paying the taxes super high current taxes expected

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Speaker 1: for example in Canada or Norway. Cool okay, So it

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Speaker 1: sounds like an option of several over time, and it

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Speaker 1: sounds like it also could be kind of like equated

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Speaker 1: to the last mile for deliveries, right like your last

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Speaker 1: ton of c O two to squeeze out in your

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Speaker 1: in your offsets exactly exactly. So how much is this

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Speaker 1: actually being used? We know it's early stage, but just

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Speaker 1: how early stage? Right now? How many tons of c

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Speaker 1: O two are currently being removed from the atmosphere via

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Speaker 1: direct air capture? Estimates say that a bit more than

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Speaker 1: six thousand tons of two can be captured per year

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Speaker 1: using direct air capture facilities already commission so that's super low.

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Speaker 1: That's very early stage. But we are seeing how the

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Speaker 1: industry is making progress. Companies are expected to commission larger

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Speaker 1: scale plans, so we're really seeing a change there. For example,

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Speaker 1: there will be a plan to will big emission this

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Speaker 1: year that we'll have a capacity of four thousand tons

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Speaker 1: of C two rights. So if we compare that to

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Speaker 1: the overall deployed capocity, that's already a significant a bondsman,

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Speaker 1: so there is significant progress there. What it is through

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Speaker 1: that we are in early stages of development of the technologies.

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Speaker 1: Pilot plants have been built on the largest scale plants

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Speaker 1: or plan to be built in the near future. Okay,

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Speaker 1: so just to recap super early stage, super expensive, but

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Speaker 1: could play a really important role in in taking C

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Speaker 1: or two out of the air in the future. When

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Speaker 1: we come back, we're going to talk about those pilot projects,

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Speaker 1: what's being done, who are the main players, and how

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Speaker 1: they're hoping to scale. Stay with us, so let's talk

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Speaker 1: about who's doing what can you tell us who the

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Speaker 1: main players are in direct air capture? There are mainly

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Speaker 1: three big players in the direct hair cutter space and

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Speaker 1: taking all their fundings together to put that into perspective,

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Speaker 1: they have raced more than three hundred millions right, and

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Speaker 1: these three main players are first Carbon Engineering, second climb

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Speaker 1: Works and third Global Thermostat are the all US companies.

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Speaker 1: Global Thermal Stati is the US company, Current Engineering is

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Speaker 1: from Canada and Climworks is actually Swiss company. And what

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Speaker 1: are they doing? So? What technology has they chosen? What

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Speaker 1: is their status report? So Current Engineering is following the

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Speaker 1: liquid absorption technology that we were talking about before, and

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Speaker 1: climb Works and Global Thermal stack the solid absorption pathway

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Speaker 1: and they also have pretty much different plans to scale

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Speaker 1: their technology to put that into a current view of

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Speaker 1: the industry. Climb Works is the company that we commissioned

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Speaker 1: the four thousand tons per year facility this year, but

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Speaker 1: then Carbon Engineering plans to commission a one million tons

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Speaker 1: per year facility by four that's two hundred fifty times

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Speaker 1: larger than the current largest back facility that will be

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Speaker 1: commissioned by Client Works. So there is massive progress in

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Speaker 1: the industry there, Uh, skeptical. So I don't know for

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Speaker 1: those listening, Like I think I mentioned this several times before,

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Speaker 1: but I used to be a CCS or carbon capture

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Speaker 1: and storage analysts ten years ago, and there's all these

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Speaker 1: announcements about projects, you know, big projects that were coming online,

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Speaker 1: and you know, big pilots as well. You know, company

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Speaker 1: would say we're gonna build three of these, We're gonna

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Speaker 1: build four of these, and I would always just say, well,

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Speaker 1: show me one. And that resulted in us putting together

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Speaker 1: this thing we called the race to first, you know,

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Speaker 1: who was going to actually build the first commercial scale

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Speaker 1: UM or large scale CCS project and we would track

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Speaker 1: and detail the progress of each project. So can you

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Speaker 1: tell me? You know, there's a big difference between a

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Speaker 1: company saying they're going to get a pilot project or

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Speaker 1: a commercial scale demo done and actually doing it. So

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Speaker 1: can you tell us about how far along they are

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Speaker 1: or is that known or not? Yeah? So, for example,

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Speaker 1: for the facility that Climbers will build this year is

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Speaker 1: pretty much in super advanced stage, so alright, alright, cool,

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Speaker 1: only finished in Iceland, so that's looking great. Of course,

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Speaker 1: looking at twenty twenty four, which is the year when

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Speaker 1: Current Engineering expects the commission there one million ton per

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Speaker 1: year facility, it's more uncertain there. But it is true

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Speaker 1: that these companies are bagged by super large oil corporations.

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Speaker 1: For example, oxy is partnering with Curbon Engineering, right Excellent

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Speaker 1: is going with global thermal style, so there is really

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Speaker 1: bugged there on now, Director Canter lives like the main

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Speaker 1: part of the carbonization solutions for large oil corporations. Okay,

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Speaker 1: let's come back to that, but let's talk about the

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Speaker 1: pilot's really quick and fine. I'm sold. It sounds it

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Speaker 1: sounds promising. So the one clear question in my mind

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Speaker 1: is is okay, so why Iceland right for a for

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Speaker 1: a demo for direct air capture. The good thing about

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Speaker 1: the facility that climb Rooks is building in Iceland is

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Speaker 1: that it is taking advantage that is located next to

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Speaker 1: a thermal power plan, So basically it's taking the heats

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Speaker 1: and electricity produced by the gil tormal plan to power

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Speaker 1: the process. So all the energy requirements are coming from

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Speaker 1: the gil term power plant. Plus, Plant Works is also

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Speaker 1: partnering with card Fix, which is a company that mineralizes

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Speaker 1: the U two, So in this facility, the c O

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Speaker 1: two is basically mineralized on a story in the long term.

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Speaker 1: So there's two advantages that are the first that the

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Speaker 1: facility is located to thermal power plant and the second

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Speaker 1: is that the C two is stored through minoralization. Okay,

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Speaker 1: I'm just gonna nerd out for a second that that's

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Speaker 1: really cool. So, like everybody listening, I'm sorry, I used

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Speaker 1: to be a geothermal analyst who ten years ago, and

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Speaker 1: I've been to this plant, the Hellociety plant in Iceland,

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Speaker 1: and and if anybody's interested, they have a really cool

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Speaker 1: visitor center you can go check it out, you know,

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Speaker 1: and have a look. But what's really cool is that

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Speaker 1: this project kind of a I don't know if it's

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Speaker 1: a dark secret, but whatever. A thing about geothermal is

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Speaker 1: that there's there's c O two in the ground and

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Speaker 1: sometimes when you pull up the water while c O

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Speaker 1: two is going to come out too. And so one

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Speaker 1: of the justifications I think for this plant was that

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Speaker 1: it can help capture some of the CEO two that's

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Speaker 1: admitted by the geothermal activity or the geothermal production and

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Speaker 1: therefore making this plant even more environmentally friendly, which is

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Speaker 1: really cool. And Iceland has a unique well unique chemistry

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Speaker 1: that can fix the CEO two in the rocks below,

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Speaker 1: unlike you know, other locations where it would just be stored,

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Speaker 1: so it'll instantly mineralized. And it's really just a pretty

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Speaker 1: cool thing. I question the you know, the ability to

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Speaker 1: scale this out much much further in Iceland, you know,

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Speaker 1: being so so small, but it's a super interesting choice

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Speaker 1: for a pilot project. It is to scale this up

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Speaker 1: to tons per year. Oh wow, Okay, that's really cool.

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Speaker 1: That's really cool, and that seems to be the challenge, right.

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Speaker 1: So from your note you said that the technology has

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Speaker 1: basically proven, but the challenge is scaling it up, is

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Speaker 1: that right? And getting the cost down. Can you talk

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Speaker 1: about what companies are doing to try to jump this

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Speaker 1: hurdle of of scale up. Companies are following different approaches, right,

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Speaker 1: So for example, climb Works is the company that has

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Speaker 1: commissioned more plants, but they are all super small scale.

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Speaker 1: But then taking advantage of ducts moderority, climb Works is

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Speaker 1: following different paths there. So for example, they are doing

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Speaker 1: a project in Norway to produce liquid fields. So taking

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Speaker 1: the sitoo that has been captured and partnering with Sunfire

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Speaker 1: and others, they are planning to produce liquid fields. Then

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Speaker 1: they are building the facility in Iceland which is actually

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Speaker 1: storing through minioralization the sudwo that has been captured, then

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Speaker 1: moving on to blow a thermostat. They are providing the

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Speaker 1: sutwo for carbonated rings and then moving on to oxy.

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Speaker 1: What oxy is sorry one oxygen current engineering moving onto

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Speaker 1: carbon engineering. What current Engineering is doing at the moment

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Speaker 1: is partnering with oxy to provide them with you two

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Speaker 1: that will be used for enhanter recovery operations. So there

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Speaker 1: are really different approaches there, all of them taking advantage

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Speaker 1: of the moderity that director capture provides. So I was

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Speaker 1: they about this morning right that when you talked about

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Speaker 1: the well the enhancesful recovery. You know you're capturing steal

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Speaker 1: two to pull up more oil. That sounds like a

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00:21:09,000 --> 00:21:11,400
Speaker 1: you know, kind of a paradox, I guess. And then

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Speaker 1: I think in the note you also mentioned that to

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Speaker 1: get the heat required to regenerate the liquid sorbi, and

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Speaker 1: they were burning natural gas. Right. To me, the comparison

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Speaker 1: that I made in my head was that, Okay, that's

395
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Speaker 1: like getting an electric vehicle but charging it with a

396
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Speaker 1: diesel generator in your back garden. So it's kind of like,

397
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Speaker 1: you know, mixing your your goals here. I think I

398
00:21:33,600 --> 00:21:37,000
Speaker 1: came to terms with it that it helps these companies

399
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Speaker 1: get to scale and come down the cost curve. Right,

400
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Speaker 1: It's a means to an end. Is that how you're

401
00:21:41,200 --> 00:21:43,800
Speaker 1: seeing it as well? Exactly? I think that's how we

402
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Speaker 1: have to see at this point. You're you're absolutely right,

403
00:21:47,240 --> 00:21:50,040
Speaker 1: just burning natural gas. I mean what comment engineering sting

404
00:21:50,200 --> 00:21:52,679
Speaker 1: is the missions that are released from burning the natural

405
00:21:52,680 --> 00:21:56,040
Speaker 1: gas are also captured, right, So look looking at the

406
00:21:56,080 --> 00:22:00,080
Speaker 1: whole solution. It is actually the one million twentyes C

407
00:22:00,280 --> 00:22:04,199
Speaker 1: two that is being removed from the atmosphere, right, and

408
00:22:04,240 --> 00:22:06,000
Speaker 1: then there is the C two that is also a

409
00:22:06,080 --> 00:22:10,200
Speaker 1: capture that comes from burning the natural gas. And you're right,

410
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Speaker 1: I would say that foreign haunter recovery purposes. This is

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Speaker 1: helpful now to help it to a scale drive town cost,

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Speaker 1: but in the longer term we will need director capture

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Speaker 1: for a propose that the main goal is to remove

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Speaker 1: emissions from the atmosphere, not to keep pumping more oil

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Speaker 1: cool Okay, that makes sense. And so who who are

416
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Speaker 1: the main drivers behind this? Like right, so it's a

417
00:22:32,720 --> 00:22:34,959
Speaker 1: there's startups, you know that they're that are involved in

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Speaker 1: doing it, But who are the drivers that are saying

419
00:22:37,600 --> 00:22:39,120
Speaker 1: they want to buy it? You know that they want

420
00:22:39,119 --> 00:22:41,880
Speaker 1: to that are interested in besides those that are looking

421
00:22:41,920 --> 00:22:44,520
Speaker 1: to use the downstream CU two. There is the big

422
00:22:44,560 --> 00:22:47,639
Speaker 1: thing the offset offsetting there, right, So we are seeing

423
00:22:47,680 --> 00:22:51,280
Speaker 1: companies that are really interested in directory capture because of

424
00:22:51,320 --> 00:22:54,480
Speaker 1: the offsetting potential. So companies that not only want to

425
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Speaker 1: remove the missions that they are currently releasing in a

426
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Speaker 1: per year basis, but also they want to remove emission

427
00:23:00,080 --> 00:23:01,960
Speaker 1: is that they've released in the past, such as the

428
00:23:01,960 --> 00:23:06,280
Speaker 1: case of Microsoft for example. So Microsoft Microsoft is investing

429
00:23:06,280 --> 00:23:09,600
Speaker 1: in client works as part of the twenty thirty portfolio

430
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Speaker 1: for removal technologies. So there is really the focus of

431
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Speaker 1: companies that really want to offset their emissions in a

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Speaker 1: easy to monitor way and verifiable way that are looking

433
00:23:20,240 --> 00:23:23,280
Speaker 1: into director capture. That's cool. Are we seeing others besides

434
00:23:23,320 --> 00:23:26,040
Speaker 1: Microsoft that they're jumping in this early and there are

435
00:23:26,080 --> 00:23:30,399
Speaker 1: other other there online web pages that are partnering with

436
00:23:30,480 --> 00:23:33,560
Speaker 1: climb Works on current engineering as well. So there are

437
00:23:33,600 --> 00:23:38,040
Speaker 1: there are companies that are interested in these director capital approaches,

438
00:23:38,320 --> 00:23:41,639
Speaker 1: but the biggest announcement probably was the one from Microsoft

439
00:23:41,840 --> 00:23:45,840
Speaker 1: towards climb Works. Okay, so a couple more questions. Let's

440
00:23:45,840 --> 00:23:49,920
Speaker 1: talk about what the future looks like if this goes right,

441
00:23:50,720 --> 00:23:53,359
Speaker 1: It would seem to me that you would want to

442
00:23:53,400 --> 00:23:57,679
Speaker 1: put these facilities in places that are really close to

443
00:23:57,920 --> 00:24:01,240
Speaker 1: storage locations. Is that right? Is that what we're starting

444
00:24:01,240 --> 00:24:03,879
Speaker 1: to see, you know, besides enhancebul recovery, you put it

445
00:24:03,880 --> 00:24:05,600
Speaker 1: in places where you can inject this year two? Is

446
00:24:05,640 --> 00:24:08,160
Speaker 1: that correct? That that's correct? For example, in the facility

447
00:24:08,160 --> 00:24:10,879
Speaker 1: that climb Works is building next to the to the

448
00:24:10,920 --> 00:24:13,240
Speaker 1: storage site, but also the one that they are building

449
00:24:13,359 --> 00:24:16,600
Speaker 1: for equid fields production next to the facility that will

450
00:24:16,600 --> 00:24:19,720
Speaker 1: produce the liquid fields, so we don't have the transport

451
00:24:19,760 --> 00:24:22,639
Speaker 1: cost there, right, Okay? Cool? And so like we can

452
00:24:22,640 --> 00:24:25,760
Speaker 1: start to predict like where these facilities might be. And

453
00:24:25,760 --> 00:24:27,639
Speaker 1: and it sounds from what you're saying, they could be

454
00:24:27,680 --> 00:24:29,240
Speaker 1: modular too, so they could just make them bigger and

455
00:24:29,240 --> 00:24:31,879
Speaker 1: bigger and bigger as you go. Is that right, that's right,

456
00:24:31,920 --> 00:24:34,560
Speaker 1: that's right then that that's what we're seeing from companies.

457
00:24:34,560 --> 00:24:37,840
Speaker 1: So all these companies, they say that their technology is

458
00:24:37,920 --> 00:24:42,200
Speaker 1: very very modular, so scaling their facilities is relatively easy.

459
00:24:42,680 --> 00:24:45,720
Speaker 1: Scaling their capacity is easy because they just need to

460
00:24:45,720 --> 00:24:48,280
Speaker 1: build more modulus and place then next to each other.

461
00:24:48,960 --> 00:24:52,720
Speaker 1: So you could basically deploy your director PUD director capital

462
00:24:52,800 --> 00:24:56,280
Speaker 1: plan where you want and also scale as you want

463
00:24:56,280 --> 00:24:58,680
Speaker 1: as well. And I guess on one more thing on location,

464
00:24:58,720 --> 00:25:02,320
Speaker 1: where's China and all this At the moment, there are

465
00:25:02,400 --> 00:25:06,439
Speaker 1: no really big main players working on director capital in China,

466
00:25:06,560 --> 00:25:08,600
Speaker 1: but of course that the focus that they industry with

467
00:25:08,680 --> 00:25:11,760
Speaker 1: Leo Cats, and I'm sure that this will be the

468
00:25:11,920 --> 00:25:14,280
Speaker 1: point that we will hear a lot talk about in

469
00:25:14,359 --> 00:25:16,119
Speaker 1: the future. That's one way you could come down the

470
00:25:16,119 --> 00:25:19,119
Speaker 1: cars curve, right, is that China jumps in and starts

471
00:25:19,119 --> 00:25:23,160
Speaker 1: building building these things like crazy. Absolutely. Absolutely. The main

472
00:25:23,200 --> 00:25:26,000
Speaker 1: thing there as well is just taking taking advantage of

473
00:25:26,000 --> 00:25:29,639
Speaker 1: the incentives available. Right. The companies don't see incentives in China,

474
00:25:29,680 --> 00:25:31,800
Speaker 1: then they go to the US, for example, to take

475
00:25:31,800 --> 00:25:34,040
Speaker 1: advantage of the forty five Q which is what we

476
00:25:34,160 --> 00:25:37,080
Speaker 1: mentioned or the low current field standard to produce lou

477
00:25:37,119 --> 00:25:40,679
Speaker 1: good fields for example. Is there government support anywhere besides

478
00:25:40,720 --> 00:25:43,560
Speaker 1: the forty five tax credit? When CCS was making a

479
00:25:43,600 --> 00:25:46,159
Speaker 1: lot of headlines, you know, a decade ago, there was

480
00:25:46,600 --> 00:25:50,520
Speaker 1: billions in government support for pilot projects. Is that looking

481
00:25:50,560 --> 00:25:52,480
Speaker 1: to be the case here as well? There has been

482
00:25:52,520 --> 00:25:55,160
Speaker 1: government funding in the UK for example, in the US

483
00:25:55,200 --> 00:25:59,560
Speaker 1: as well for the deployment of director capital technologies raised

484
00:25:59,640 --> 00:26:04,360
Speaker 1: Also of these hundred million you have fun or challenge

485
00:26:04,560 --> 00:26:06,919
Speaker 1: that Ellen Mask has done, which is kind of massive

486
00:26:06,960 --> 00:26:10,119
Speaker 1: as well, But these companies have raised significant funding, right

487
00:26:10,200 --> 00:26:12,600
Speaker 1: so what they need at the moment is a large

488
00:26:12,640 --> 00:26:16,920
Speaker 1: amount of money talking the order billions to scale their technology. Okay,

489
00:26:16,920 --> 00:26:18,679
Speaker 1: so it doesn't seem like there's a huge money from

490
00:26:18,720 --> 00:26:21,760
Speaker 1: government's going into pilots or demo projects. But can you

491
00:26:21,800 --> 00:26:24,920
Speaker 1: also describe this. Is it a prize from from Elan

492
00:26:25,000 --> 00:26:26,960
Speaker 1: Mask or what is that? That is actually a price

493
00:26:27,320 --> 00:26:30,560
Speaker 1: from Milan Mask that was announced this year, but that's

494
00:26:30,560 --> 00:26:33,840
Speaker 1: for different remobile technologies. But it will be very cool

495
00:26:33,880 --> 00:26:36,159
Speaker 1: in order to see the role that direct hair capitual

496
00:26:36,200 --> 00:26:39,760
Speaker 1: places there, because other removable technologies can play role through

497
00:26:39,760 --> 00:26:43,920
Speaker 1: ocean in oritization, etcetera. So it's not only focused on

498
00:26:43,960 --> 00:26:46,160
Speaker 1: direct hair capitual, but it will be cool to see

499
00:26:46,359 --> 00:26:49,719
Speaker 1: the role THATTTAG place given how much focused on how

500
00:26:49,800 --> 00:26:53,160
Speaker 1: much attention the industry currently has one final question, so

501
00:26:53,240 --> 00:26:55,240
Speaker 1: what is the what is the next step in our

502
00:26:55,359 --> 00:26:57,920
Speaker 1: research in this in this area? Are we gonna keep

503
00:26:57,920 --> 00:27:00,600
Speaker 1: going with direct air capture? Is there? Do you have

504
00:27:00,600 --> 00:27:03,240
Speaker 1: a pipeline research that your questions you want to look

505
00:27:03,280 --> 00:27:06,560
Speaker 1: at or what what are we seeing? I personally think

506
00:27:06,600 --> 00:27:09,480
Speaker 1: that the next thing to look at is to see

507
00:27:09,760 --> 00:27:13,040
Speaker 1: the progress that these companies are doing in their announcements,

508
00:27:13,280 --> 00:27:16,600
Speaker 1: so really seeing whether this plant are being commissioned, construction

509
00:27:16,680 --> 00:27:20,560
Speaker 1: has it started. How the utilization market evolves as well, right,

510
00:27:20,920 --> 00:27:24,440
Speaker 1: so climb walks for example, that is doing the fields facility.

511
00:27:24,480 --> 00:27:27,359
Speaker 1: How all these markets that are focused in utilization and

512
00:27:27,440 --> 00:27:30,359
Speaker 1: that can bring new revenue streams evolved, So that's a

513
00:27:30,400 --> 00:27:34,720
Speaker 1: big part. And also making progress on driving down the

514
00:27:34,800 --> 00:27:39,520
Speaker 1: cost learning from operating the facilities driving down capex as well.

515
00:27:40,000 --> 00:27:43,040
Speaker 1: So the focus is really understanding how we can drive

516
00:27:43,119 --> 00:27:47,360
Speaker 1: down cost and then understanding the role that the instigization

517
00:27:47,400 --> 00:27:51,919
Speaker 1: market will have in the overall deployment of Director Cutter. David,

518
00:27:52,040 --> 00:28:01,520
Speaker 1: thanks for joining. Thank you Mark. This week's show was

519
00:28:01,520 --> 00:28:04,480
Speaker 1: produced by Ava gonzalezi Isla and edited by Rex Horner

520
00:28:04,520 --> 00:28:07,280
Speaker 1: of Grace Took Media. Bloomberginniac is a service provided by

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00:28:07,280 --> 00:28:10,800
Speaker 1: Bloomberg Finance LP and its affiliates. This recording does not constitute,

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00:28:10,920 --> 00:28:14,360
Speaker 1: nor should it be construed, as investment advice, investment recommendation,

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00:28:14,600 --> 00:28:17,880
Speaker 1: or recommendation as to human investment or other strategy. Bloomberg

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00:28:17,920 --> 00:28:20,880
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00:28:20,880 --> 00:28:24,320
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00:28:24,400 --> 00:28:27,640
Speaker 1: any of its affiliates makes any representation or warranty unders

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00:28:27,680 --> 00:28:30,440
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00:28:30,560 --> 00:28:33,240
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